The unitary patent package unwrapped

13.12.12

 

The biggest change in European patenting practice since the European Patent Convention is happening.

Earlier this week the European Parliament approved controversial new legislation which will establish a unitary patent right across 25 European countries. It will also create a new pan-European court system through which that right may be enforced in a single proceeding.

But that's not all; starting in 2014 all existing European patents - which currently have only national status in designated countries - will become vulnerable to a single centralised validity attack and enforceable across all the designated countries by a single action in one of them.

There is of course an "opt out" period in which proprietors can test and evaluate this additional right; but at the end of the transition period (which may be up to 14 years) the opt out will cease and all European patents will be unitary in nature. At that stage the national European patent courts will lose all jurisdiction over European patents and the new court structure will take over entirely.

Can this really be happening? Yes, subject to very few remaining stages. Cries of protest from established practitioners, proprietors and even judges have been largely ignored. The political will to force this very substantial change is strong; the European legislation has been passed, although it remains for the 25 countries involved (the EC member states minus Italy and Spain) to formally sign off the international agreement which will establish the new court structure. The agreement will then have to be ratified by at least 13 countries, which must include the UK, France and Germany.

A rearguard action by Italy and Spain to challenge the legality of this process at the European Court of Justice (CJEU) appears destined to fail. The Advocate General has this week issued an adverse opinion, although the CJEU will not pronounce until early next year. Spain and Italy may still join the scheme if they wish.

It therefore appears that, once the transition period is over, we are going to lose the adversarial process which is the defining characteristic of the UK Patents Court for all but national GB patents (which will continue as before). Instead, there will be a multi-lingual pan-European court using procedures which are an amalgam from various continental jurisdictions.

There will, however, be changes for everyone. The UK loses the adversarial process, but German practitioners will have to get used to disclosure and a high degree of transparency. In turn, the French will forego the automatic right of appeal to which they are accustomed. In countries where there has been little patent litigation to date there is the possibility of regional courts developing significant expertise, and offering cost-effective patent protection to those who could not previously afford it.

Proprietors based outside Europe may well be pleased to say goodbye to country by country enforcement in Europe with the risk of conflicting results - albeit that the price is a large egg in a single basket.

Will the new system work? There has been much talk of all the problems the draft legislation and agreement presented, and of a poorly implemented change being worse than none at all. However, there will be public consultation on the court rules (which is to begin shortly) and much depends on whether proprietors choose to engage with the new system; if there is a move towards national patents and away from European filings then the change may appear retrograde in the short to medium term.

In the longer term, however, the principal objective is very worthwhile and should be achievable. Now that we have legislation in place (with whatever faults) it is incumbent on all of us to make it work by engaging and contributing in the months and years ahead. The prize will be broader based and more effective patent protection for all.

 

Key Contact

Gordon Harris, partner, +44 (0)121 629 1499 / +44 (0)20 7664 0326, gordon_harris@wragge.com

Nicholas Cunningham, partner, +44 (0)121 214 1068, nicholas_cunningham@wragge.com

This analysis may contain information of general interest about current legal issues, but does not give legal advice.